As is well known, new market demand for lithium-ion batteries is rapidly forming. Lithium ion batteries are currently divided into three major sections. The first is consumer electronics. Nowadays, the vast majority of mobile devices, smartphones, and laptops already use lithium-ion batteries, and this market capacity can be calculated in billions of units. The second is the growing demand for electric vehicles, whether they are pure electric vehicles or plug-in hybrid vehicles, which has gradually formed. Thirdly, in the future, the market capacity of lithium batteries in the energy storage field will be even wider than that of electric vehicles, and its market can even be measured by a trillion yuan output value.
The demand for electric vehicles and energy storage markets has created a new market space for lithium-ion batteries. At present, a group of enterprises with technological foundation and production capacity are growing very rapidly, and the technological progress of power batteries is also very rapid.
At present, the requirements for electric vehicles and energy storage applications require the industrialization of products with safety, high energy density, long lifespan, low cost, and mature technology to match the rapid development of these two industries. From now on, lithium-ion power batteries are currently the best choice. The vast market demand is also attracting a lot of R&D and manufacturing investment into this industry, promoting the rapid development of lithium-ion battery technology, so this industry has been developing very quickly recently.
Let me briefly introduce CATL. CATL Battery is a service that focuses on integrating power batteries and energy storage battery box systems. It has the ability to research and develop, design, mass produce, and recycle batteries from battery materials, battery cell modules to system integration, providing solutions throughout the entire industry chain. Currently, CATL is positioned as a high-end product manufacturer and a strategic supplier for many new energy passenger vehicles and bus battery systems. We aspire to become a world-class battery supplier and provide battery solutions to our customers.
When it comes to power batteries, they are actually very important in terms of technology. Power batteries pursue five aspects of performance, with safety being the top priority. The other two pursuits are energy density, power density, and most importantly, service life. Our power batteries are guaranteed for 8 years in the market. I hope our power batteries can last for 20 years in terms of future energy storage. The last one is cost. The balanced development of the five aspects requires a larger system to ensure the balanced development of these five aspects. For example, electrochemical equipment, processes, quality, supply chain, materials, thermal management, testing and verification are all indispensable. If these aspects cannot be fully guaranteed and progressiveness, it is difficult to ensure the performance of the five aspects of the power battery core. Therefore, the R&D and production of power batteries is a technology intensive and capital intensive industry that requires huge investment.
The product route of new energy in the era is already very clear. In energy storage and power battery systems, choose the lithium iron phosphate system - lifepo4 battery. In the power battery system of commercial buses, also choose the lithium iron phosphate system because it is relatively safe and can meet the needs of these two aspects. In the power battery system of passenger cars, including pure electric, plug-in hybrid, and now micro hybrid systems, a ternary material system is chosen to develop products.
The technological progress of lithium power cells can be roughly divided into three points.
The first is the demand for pure electric vehicles. One is 180 watt hours/kg, and the plug-in type is 125 watt hours/kg, both of which have successfully achieved mass production. After five years of effort, China's power battery products have achieved the target of energy density ranging from 300 to 350 watt hours/kg while ensuring the original five performance requirements, and have also achieved mass production. Secondly, there will be a significant application in the future, which is to achieve fast charging of power batteries. Our goal in this regard is to fully charge the battery in 10 minutes, with a charging capacity of 4C in 10-15 minutes. Finally, there will be a significant amount of starting and stopping batteries in the future, such as 12V or 48V, for micro hybrid applications. If these technologies are implemented, they can cover all aspects of China's future demand for electric vehicles and energy storage applications, including cost, lifespan, and performance. At present, in order to improve the environment and ensure the development of energy, two very important trends will emerge. At the energy generation end, which is the power generation end, the proportion of clean energy will definitely start to increase and increase, including nuclear power, photovoltaic, wind energy, and bioenergy. On the other hand, on the energy consumption side, it can be seen that equipment such as fossil fuels will gradually become electrified and replaced by electrical equipment. Electric vehicles are a very typical example of switching from oil to electricity. Once these two trends are formed, energy storage will play a very central role in them. Lithium ion batteries, as a means of energy storage in a broad sense, have excellent advantages and are also the best choice in the market. Because this large-scale industrial chain is gradually forming, it is directly pure electric, so the efficiency is relatively high. At the same time, the technology with an ultra long service life will soon mature. Because CATL is now pursuing that the single cell can achieve 15000 cycles, which means that its service life is more than 20 years. Its response speed and applicability to the environment are superior to others. Therefore, energy storage and equipment will have an unusually broad market in the future world.
So from the perspective of energy storage, from power generation, transmission to distribution, to electricity consumption, almost every link can be used. In the future, with the increasing proportion of clean energy and energy conservation and emission reduction, energy storage can theoretically be used wherever electricity is available.
Let me emphasize that if we divide an energy storage system into four major parts. One is the energy storage unit, which has many batteries and various things; The other is energy conversion, which is the thing that converts direct current and alternating current back and forth; Another is energy access, such as transformers and switchgear; The most important aspect is energy management, which is crucial for future smart grids, smart cities, and effective management of various energy options. These technologies are all moving towards maturity.
A crucial factor in energy storage business is the reliability of the product and its lifespan. Basically, the future intelligent operation needs to achieve maintenance free, intelligent operation with a service life of 20 years, and large-scale and standardized production to reduce costs. The most important thing is to form industries for cascade utilization. Because if the power battery can achieve a mission life of 20 years, after 8 or even 10 years of use in electric vehicles, this battery can be completely recovered at a very low cost and used for energy storage in the power grid. This puts forward some very important requirements, which are to have a sufficiently long lifespan and good performance when designing battery cells. When making modules and electric vehicles, it is necessary to consider that future modules and battery packs for electric vehicles can be easily applied to energy storage systems. Don't dismantle anything, just connect it together and you can use it. After the energy storage is used up, it will be uniformly recycled into raw materials before being used as battery cells. This is very likely to form a very complete recycling industry chain. Once this industry chain is formed, it can generate very good economic benefits in every link, so it is a relatively sustainable development idea.
